The Marijuana Industry After Crouse, 0118 COBJ, Vol. 47, No. 1 Pg. 27

Position:Vol. 47, 1 [Page 27]

47 Colo.Law. 27

The Marijuana Industry after Crouse

Vol. 47, No. 1 [Page 27]

The Colorado Lawyer

January, 2018


Is the Glass Half Empty or Half Full?


This article discusses the split decision in People v. Crouse and its effect on Colorado marijuana law and the cannabis industry.

On January 23, 2017, the Colorado Supreme Court decided People v. Crouse.1 The Court held, 4–3, that a provision of Colorado’s Medical Marijuana Amendment is preempted by the Federal Controlled Substances Act (the Act).2 Crouse is another decision in a line of Colorado cases that rely on the Act’s prohibition of cannabis to decide cases against users or sellers of cannabis. But the decision can be understood another way too: Crouse protects Colorado’s overall legalization scheme and prevents the federal court system from hearing a similar case.

This article examines the legal impact of Crouse and its potential effects on marijuana businesses.

The Crouse Facts

Crouse was arrested by state police and charged with violating state law because he possessed marijuana plants.[3] He was tried and acquitted after raising Colorado’s medical marijuana amendment, Colorado Constitution Art. XVIII § 14 (the Amendment), as a defense.4 Based on section 14(2)(e) of the Amendment (the Return Provision), Crouse petitioned for return of his plants.5 The People opposed the motion, claiming that law enforcement offers could not return his marijuana plants without violating the Act, which prohibits the distribution of marijuana.6 In other words, the authorities argued that by complying with state law, they would violate federal law. The trial court granted Crouse’s request and ordered the police to return his cannabis.[7]

The People appealed. The Court of Appeals ruled in Crouse’s favor in a split decision and held that the provision at issue did not conflict with the Act.8 The Colorado Supreme Court granted certiorari.

The Colorado Supreme Court’s Opinion

The Supreme Court reversed the Court of Appeals’ decision.9 Crouse thus invalidates the Amendment’s Return Provision because it conflicts with federal law.10 Consequently, state authorities no longer have to return seized marijuana to those who are exonerated by state courts.11 Indeed, this decision suggests that state authorities cannot return cannabis without violating federal law.12

The decision is noteworthy for two primary reasons. First, the Court held that there is a positive conflict between state and federal law.13 Such a conflict arises when a person cannot comply with both state and federal law.[14] This is precisely the case with the Act and the Amendment’s Return Provision: state authorities must either violate federal law by distributing marijuana (i.e., giving it back to those from whom it was seized) or violate state law by refusing to abide by the Amendment’s Return Provision and state court orders requiring the return of the marijuana.15

Second, the Act allows “any duly authorized officer of any State, territory, [or] political subdivision thereof . . . who shall be lawfully engaged in the enforcement of any law or municipal ordinance relating to controlled substances” to distribute such substances without fear of federal criminal liability.16 The Court held that this exception does not apply to officers returning marijuana under Colorado’s medical marijuana amendment because, in essence, state law cannot legalize what remains illegal under federal law.17

The Court relied, in part, on its decision in Coats v. Dish Network, LLC, which held that Colorado’s “lawful activities statute,” which prohibits employers from taking adverse action against employees engaged in lawful activities, did not apply to an employee’s medical marijuana use.18 The reasoning in Coats and Crouse was similar: the fact that the medical marijuana amendment eliminated criminal penalties did not make the use of marijuana “lawful,” because federal law still prohibited its use and distribution.19

The Dissent

The dissent, written by Justice Gabriel and joined by Chief Justice Rice and Justice Hood, disagreed with the majority’s analysis on one key point: whether the Act’s allowance of distribution of a controlled substance by one “lawfully engaged in the enforcement of any law or municipal ordinance relating to controlled substances” allows an officer to return cannabis to its owner upon a court order.20 The dissenters would have held that an officer’s action under the Amendment’s Return Provision falls within the same exception that allows officers to conduct sting operations (i.e., posing as sellers or buyers of controlled substances and using that information to arrest those who violate the law).21

Ultimately, the majority and the dissenters agreed that the majority’s opinion is driven by the purpose behind the Act: preventing the distribution of controlled substances. This analysis accounts for the difference between the majority and dissenting views...

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